Nope. Missed the move completely. Hope you made a ton of $$ and that you took some off the table, just to be safe. Have to come up with a new indicator that lets me know when a news story is about to break and send the markets to the moon. Now that would be worth some money.
Meanwhile, in another part of town, many breadth indicators pushed deep into extreme overbought territory so don’t expect much for Monday. For example, $TRIN closed at .30 and about 95% of volume went into advancing issues. But we’ll see. Maybe another bit of news will come out of Europe and markets just lift off.
My wife and I are leaving on a road trip to southern British Columbia on Thursday and we’ll be gone for up to a week so probably not going to be doing much, if anything, next week.
Below is the chart I’m watching now. Today we have an indecision doji with perhaps a bottoming tail.I’ve redrawn the lower trend line, cloned it, and placed it along a couple of tops to create a revised rising price channel. I feel that this is valid because we do not have a lower low. Should $SPX drop below 1325 any time before it rises above 1380, then I will change the chart to reflect a down trend. We could also be looking at a Bull Flag pattern, just like the pattern that we had from the 3rd through the 12th.
$NYSI has started to roll over and may give the first part of a new sell signal by Friday’s close. The fact that $NYSI is rolling over is a negative for the market and so I’m expecting $SPX to drop below 1325 sooner rather than later. Also, while the market kinda’ rallied today, $TRIN closed at 1.19 and volume going into declining issues was slightly greater than volume going into advancing issues. So while the green day on the $INDU and $NYA looked good, it didn’t smell good. Also, transports, which have been struggling all year, are now back in the same place they were on December 19th 2011 so they’re negative for the year and then some.
Recent market action just does not inspire confidence, at least for me. Maybe the market will bounce, like it has after every recent and 4-5 day pull back, maybe not. Until the market gives a clear signal one way or the other then cash is king and market is best left to adept day traders, IMHO, of course.
Edit: Just wanted to point out that each time since early June that the 5,3,3 stochastic has tagged or dropped below 20 the market has bounced. Basically we’re there so if there’s going to be a bounce it should start tomorrow. I don’t know it the market will bounce and in fact I’m doubtful, but the opportunity is there.
Click on the chart for a larger view.
As always, be careful. If you decide to play, keep position sizes small and don’t turn your back on the market because only the paranoid survive.
I really didn’t want to be in this trade. Prefer cash right now. Huge move in $SOX index was the juice behind the move so far, but that’s probably not going to repeat tomorrow.
Added a bunch of shares at 45.99 then sold at $46.72. Don’t care what the market does now because I consider this to be counter trend and even though I initially only had a few shares, it could have been a huge down day and then I’d be holding those shares for quite some time. Don’t like to short so cash will have to do.
For the record, I did not get in the market on Monday when the RSI on the 60min charts dropped below 30. I’ve been lucky the last two times I’ve gone long per the 60min trading strategy so I just figured I’d sit it out this time. Besides that, I have ‘sell/avoid’ signals in the daily charts of just about everything so why take the risk?
However, I did roll the dice with some TQQQ late in today’s session, for obvious reasons. AAPL’s earnings and forecast didn’t go my way, so now I’m seriously under water with those shares. My only saving grace is that I bought fewer than 20 shares as a possible entry position. If things had worked out, I would have added more and scaled in. Not the first time I’ve been upside down and worked my way out over time. I wouldn’t be surprised if I get out of these close to break even sometime tomorrow.
Breadth indicators are close to giving extreme oversold signals and if the market does what I expect it to do tomorrow, then things like Zweig Breadth Thrust will drop into extreme oversold territory and a bounce of one degree or another will follow so no reason for me to sell until I see if the bounce does materialize on Thursday/Friday.
Do not try this at home.
60 minute trading strategy in action, or, wash, rinse, repeat.
Q’s remain strong in PM action mainly because they have little exposure to financials. Same cannot be said of $RUT/IWM & $SPX/SPY. At 8:56 A.M., ES is off 9.25pts but this is most likely going to be bought back up so that it can be sold into, at least that’s what I think.
As anyone who’s been following this blog for any length of time knows, I’ve been using the 60min trading strategy exclusively lately to time entries and exits. That’s not 100% accurate because per the 60min trading strategy I should have gone long last Thursday, the 12th, but I was expecting more down side so I held off. The break of the falling trend line at last Friday’s open forced me to go long. As far as I’m concerned, when the RSI 14 gets above 70 on the 60min charts you are playing with fire. I figured that the mad men at the helm could hold the Q’s up for 2-3 days, which is what they did in the last cycle, so I didn’t sell Wednesday when the RSI first pushed above 70. Yesterday I placed my ‘sell’ order for TQQQ when the Q’s were trading right around $65. I gambled that THEY would spike the Q’s up sometime during the session and had calculated a 10% gain based on my entry. I put the order in and left on my bike ride. My gamble paid off and my order was filled within pennies of the daily high on TQQQ with the RSI on the Q’s having spiked to 77, an unsustainably high reading.
60min chart of Q’s showing entry points and exit points per the RSI 14.
I’ll just be watching from the cheap seats for a while.
Well, I couldn’t do it, couldn’t hang on to TQQQ any longer. Based on AH action with GOOG and others, looks like I’ll miss out on some more gains, but a 10% gain, less commissions, is good enough for me.
Placed my order then went for a bike ride. When I got back 2 1/2hrs later, the order had been filled. I’m in no hurry to get back into anything.
Note that today $TRIN closed at 1.08 so another instance of Stealth Distribution. Will this work it’s magic again? Just have to see.
I don’t know if you’ve noticed, but market internals have not been very strong the last two days. On Wednesday, with $NYA up almost 1/2%, volume going into advancing issues was not quite 2:1 the volume going into declining issues. That kind of ratio isn’t really showing much strength, but it was enough. Then today the same ratio would be 3.8:3.5 and that is not enough to keep the markets moving higher. Also, $NYSI rose by 29pts on Wednesday but only rose by 24pts today, which indicates market strength is being replaced by market weakness. If this pattern of weakness continues, the market cannot help but feel its effects and roll over.
Shrimp that dozes is shrimp on the platter.
$TRIN closed at 1.16 today so we have one instance of Stealth Distribution in place. Will there be one or two or more instances of this like we had at the end of June and the 1st two days of July? Will be interesting to see.
Still hanging on to TQQQ but have not aded and probably won’t. 60min chart is now showing overboughtness but it looks like IBM’s and QCOM’s earnings could influence market direction tomorrow, or famous last words. Still trying to hold on to this position until AAPL reports, which happens next Tuesday, the 24th. Never sure, though. Could take profits at any time.
60min chart showing that today the RSI pushed above 70. Normally this would show overbought and indicate that it’s time to take some money off the table pending an expected pull back.
Today $SPX closed within two points of its July 3rd, closing high. I’ve been thinking that we would put a double top in here in this area, but there seems to be enough momo to take the markets higher, though I certainly don’t know how much higher. I will let the charts lead the way on this.
There are a couple of signs of negative divergence in breadth indicators, specifically $NYHGH & $NYHILO. By themselves, they are not enough to turn the market, but they could exert influence on other breadth indicators if they don’t get back in sync with other indicators so these need to be watched for the next couple of days.